Markup is the amount added to the cost of a product to determine its selling price.
Businesses frequently use markup percentages when pricing products.
Markup Percentage Formula
Use:
Markup Percentage = ((Selling Price − Cost) ÷ Cost) × 100
Suppose a product costs $60 and is sold for $90.
Markup amount:
90 − 60 = 30
Then:
(30 ÷ 60) × 100 = 50%
The markup is 50%.
Calculate Selling Price From Markup
If a product costs $200 and you want a 30% markup:
200 × 0.30 = 60
Selling price:
200 + 60 = $260
For the percentage calculation, you can use Manarty’s Percentage Calculator.
Markup vs Margin
Markup and profit margin are not the same.
Markup compares profit with cost, while margin generally compares profit with selling price. Confusing the two can result in incorrect pricing decisions.